Amazon Sells Cloud Assets in China Due to New Rules

Amazon Sells Cloud Assets in China Due to New Rules

Amazon Sells Cloud Assets in China Due to New Rules

Amazon said via a post on its website that its China public cloud services were managed exclusively by Sinnet.

The U.S. company has agreed to sell its China-based web services business to Beijing Sinnet, the local partner that operates it, according to a filing on the Shenzhen Stock Exchange that was noted by The Wall Street Journal and Reuters. Due to compliance issues, Amazon began operating AWS services in 2016 through its partner Sinnet. "In order to comply with Chinese law", Amazon "sold certain physical infrastructure assets to Sinnet", it said.

"In order to comply with Chinese law, AWS sold certain physical infrastructure assets to Sinnet", a spokesman for the cloud-services unit said on November 14, adding AWS would still own the intellectual property for its services worldwide.

China's internet safety laws, which entered into force in June, require domestically gathered customer data that is stored locally or removed from the country to be screened by authorities.

Amazon is committed to establish in China, and is looking forward for significant business opportunities and growth potential for the next few years.

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The company explained: "Chinese law forbids non-Chinese companies from owning or operating certain technology for the provision of cloud services".

Earlier this year Apple transferred data to China-based companies.

Amazon's decision casts a shadow over similar ventures in the country.

Amazon announced its China AWS region back in December 2013, and noted at the time that, to comply with China's legal and regulatory requirements, it was working with local companies, including Sinnet, who would provide the necessary data centre infrastructure, bandwidth and network capabilities.

Big name tech companies in the US often bend over backward to either attempt to penetrate the highly protected Chinese market, or maintain a somewhat established presence.

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